The German record market is showing signs of recovering from the drastic downturn of the past five years.
In 2005, the trade value of the German market contracted by just 0.4% year-on-year to €1.746 billion ($2.12 billion), according to figures collated by Nuremberg-based market research institute GfK and published today (March 21) by German Federal Assn. of the Phonographic Industry (BPW).
This compares with an overall contraction in the market over the past half-decade of roughly 50%.
BPW members’ shipments accounted for €1.5 billion ($1.8 billion) in trade value, some 86% of the GfK total. That was down 4.6% from 2004. The BPW has 300 members.
GfK statistics indicate that the remaining 14% was accounted for by independent players in the market. Their collective sales rose 33% to €246 million ($299 million) in 2005, up from €165 million ($200 million) in 2004.
The BPW’s members shipped 123.7 million CD albums in 2005, down 5.5% on 2004, the figures indicate. Shipments of singles slipped 27% in 2005 to 15.4 million units, while pre-recorded cassettes plummeted 36.4% to 7.5 million.
The volume of BPW members’ music DVDs shipments was largely flat, falling to 9.8 million from 9.9 million units.
In terms of albums chart share, international recordings accounted for 42.4%, down from 44.8% in 2004. Local recordings accounted for 35.3% of charting albums, up from 30.3% the previous year. Compilations accounted for 20.5%, down from 22.3%; soundtracks accounted for 1.9% vs 2.6%.
Data reported by BPW shows digital download sales more than doubled in 2005 to 16.4 million tracks. The trade body’s chairman Michael Haentjes warns that the industry should brace itself for ongoing tough times ahead.
“Trends in digital music distribution are encouraging,” he says. “We hope that in the medium term, digitalization will provide an additional source of business for us. However, in spite of the positive signals I am not very hopeful that the worst is really behind us.”
Illegal file-sharing and CD-burning remains a major problem for the legal German music market. The GfK report claims that roughly three-and-a-half times as many CD-Rs were used to copy music last year than legal pre-recorded albums were purchased.
GfK claims German computer users downloaded 415 million illegal music files last year, up from 383 million in 2004, the figures illustrate. “If that copied music had been bought, it would have generated revenues of €6.3 billion ($7.6 billion),” says Haentjes.